mapletree greater china commercial trust... · ipo (7 mar 2013) to 30 sep 2016 18.3% 25.5% 43.8% 1....

Mapletree Greater China Commercial Trust

SGX-REITAS Education Series

8 November 2016

Disclaimer

This presentation shall be read in conjunction with Mapletree Greater China Commercial Trust’s (“MGCCT”)

financial results for the period from 1 April 2016 to 30 September 2016 in the SGXNET announcement dated 27

October 2016.

This presentation is for information only and does not constitute an invitation or offer to acquire, purchase or

subscribe for units in MGCCT (“Units”). The value of Units and the income derived from them may fall as well as

rise. Units are not obligations of, deposits in, or guaranteed by, the Manager or any of its affiliates. An

investment in Units is subject to investment risks, including the possible loss of the principal amount invested.

Investors have no right to request the Manager to redeem their Units while the Units are listed. It is intended

that Unitholders of MGCCT may only deal in their Units through trading on the Singapore Exchange Securities

Trading Limited (“SGX-ST”). Listing of the Units on the SGX-ST does not guarantee a liquid market for the

Units. The past performance of MGCCT is not necessarily indicative of its future performance.

This release may contain forward-looking statements that involve risks and uncertainties. Actual future

performance, outcomes and results may differ materially from those expressed in forward-looking statements as

a result of a number of risks, uncertainties and assumptions. Representatives examples of these factors include

(without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital

availability, competition from similar developments, shifts in expected levels of property rental income, changes

in operating expenses, including employee wages, benefits and training, property expenses and governmental

and public policy changes and the continued availability of financing in the amounts and the terms necessary to

support future business. You are cautioned not to place undue reliance on these forward looking statements,

which are based on current view of management on future events.

Mapletree Greater China Commercial Trust (“MGCCT”)

3

First commercial REIT with assets in China & Hong Kong (listed since 7 March 2013)

Public Unitholders

Festival Walk

Gateway Plaza

Sandhill Plaza

Portfolio

Mapletree Investments

Pte Ltd (“MIPL”)

Sponsor

Mapletree Greater China

Commercial Trust

Management Ltd.

REIT Manager

DBS Trustee Limited

(the “Trustee”)

Trustee

Mapletree Greater

China Property

Management

Limited

Property Manager

35% 65%

100%

100%

100%

S$5.8 bil Portfolio Appraised

Value1

35% Unitholdings held by Sponsor

Festival Walk,

Hong Kong

Sandhill Plaza,

Shanghai

S$3.1 bil Market

Capitalisation2

6.5% Annualised

Distribution

Yield3 ~2.6 mil sq ft Lettable area

3 Properties

Hong Kong Beijing Shanghai

1. Based on exchange rate of S$1: HK$5.728 and S$1: RMB4.932 as of 30 September 2016

2. As at 30 September 2016

3. Percentage of annualised DPU at the end of 1H FY16/17 over unit closing price of S$1.10 on 30 September 2016

Gateway Plaza,

Beijing

• To invest in a diversified portfolio of income-producing real

estate in the Greater China region for commercial purposes

• Key markets include Hong Kong, Tier-1 cities in China

(Beijing, Shanghai, Guangzhou and Shenzhen) and key Tier-

2 cities in China

Investment Mandate

Quality Portfolio of Resilient Assets

Active Asset Management

Active Asset Enhancement

Delivering Stable Returns to Unitholders

About MGCCT

1

2

5

4

Value-creating Acquisition Growth 6

Proactive Capital and Prudent Risk Management 3

Festival Walk (又一城) – Best-in-Class Territorial Mall

Premier Shopping, Dining

and Lifestyle Destination

Strategically Located in the Heart

of Kowloon Tong, Hong Kong

100% Occupancy since

Completion in 1998

Office

5

Retail

http://www.uniqlo.com/sg/

FW: Best-in-Class Territorial Mall

Attractive catchment area and excellent connectivity Over 200 local and international retail brands

7-storey mall Glacier (Ice Rink) – one of the largest in Hong Kong

6

TasTe Supermarket – the first TasTe in Hong Kong

FW: Premier Shopping, Dining and Lifestyle Destination

Enhanced cinematic experience at FW's new cinema

1st Apple Store in Kowloon 1st H&M store in a mall in Asia

7

Gateway Plaza (佳程广场) – Premier Grade-A Office Building

Recently Completed Asset

Enhancement Works at the

Podium

Premier Grade A Office Space

in Beijing’s Lufthansa Area

8

Excellent Connectivity,

between the CBD and Airport

Key Tenants

Sandhill Plaza (展想广场) – Premium Quality Business Park

1. Please note that there are eight blocks of low-rise (3-storey) buildings within the subject premises. However, one

block is separately owned by a third party and does not form part of the acquisition.

Largely from IT, High Tech, Industrial and R&D sectors

9

Located in Shanghai’s

Zhangjiang Hi-tech Park, a

Free Trade Zone

Premium Grade-A

Building Specifications

Comprises one 20-storey tower, seven blocks of 3-storey buildings1 and two basement levels of carpark

Established Tenants

including Leading Global

Companies

2

3

4

5

6 7 8

Sandhill Plaza

1

20-storey building with Grade-A specifications One of the seven blocks of low-rise buildings

Spacious 1,500 sqm Food Court Office Tenants include Starbucks

SP: Premium Quality Business Park

10

Portfolio Composition (1H FY16/17)

11

Festival Walk, 71%

Gateway Plaza, 22%

Sandhill Plaza, 7%

% of Gross Revenue % of Net Property Income % of Asset Value

Festival Walk, 69%

Gateway Plaza, 23%

Sandhill Plaza, 8%

Festival Walk, 72%

Gateway Plaza, 21%

Sandhill Plaza, 7%



About MGCCT

1

2


Active Asset Enhancement 5

4



1. For a more meaningful comparison, the stub period from 7 to 31 March 2013 has been excluded

13

Delivering Stable Returns to Unitholders since IPO

252.5

281.1

336.6

168.0

204.3

229.3

277.5

136.7

0.0

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0

FY13/14 FY14/15 FY15/16 1H FY16/17

S$mil

Gross revenue Net Property Income

1

YTD

159.2 178.0

199.9

100.3

5.929

6.543

7.248

3.610

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

0.0

50.0

100.0

150.0

200.0

250.0

FY13/14 FY14/15 FY15/16 1H FY16/17

cents S$mil

Gross revenue Net Property Income

YTD

Distributable

Income (DI)

Distribution per Unit

(DPU)

Growth in Gross Revenue and NPI Growth in DI and DPU

Gross Revenue Net Property Income (NPI)

1

Delivered a Healthy Total Return of 43.8% since IPO

Rebased MGCCT Price against Major Indices

(7 Mar 2013 to 30 Sep 2016)

Source: Bloomberg

As at 30 Sep 2016

No

te: R

eb

ase

d o

pe

nin

g p

rice

s o

n 7

Ma

r 2

01

3 to

10

0

FTSE Straits Times Index

FTSE Straits Times REIT

Index

Hang Seng Index

MGCCT

Period Price Appreciation1 Distribution Yield2 Total Return3

IPO (7 Mar 2013) to 30 Sep 2016 18.3% 25.5% 43.8%

1. Based on opening IPO price of S$0.93 as of 7 March 2013 and closing unit price of S$1.10 as of 30 September 2016

2. Comprising seven distributions paid out to Unitholders from FY13/14 to 2Q FY16/17

3. Sum of price appreciation and distribution yield

MGCCT’s unit closing price on

30 Sep 2016 was S$1.10

14

FTSE Straits Times Index FTSE Straits Times REIT Index Hang Seng Index

MGCCT Offers a Higher Yield vs other Comparable Instruments

1. Based on annualised DPU for the period 1 April 2016 to 30 September 2016 and closing unit price of $1.10 on 30 September 2016.

2. 12-month gross dividend yield of FTSE Straits Times (ST) REIT Index as of 30 September 2016, Bloomberg.

3. 12-month gross dividend yield of Hang Seng Index as of 30 September 2016, Bloomberg.

4. Prevailing interest rate on Central Providend Fund (“CPF”) Ordinary Account Savings from CPF Board, July to September 2016.

5. Singapore Government Bond Yield from Monetary Authority of Singapore, as of 30 September 2016.

6. Hong Kong Government Bond Yield from Hong Kong Government Bond Programme website, as of 30 September 2016.

7. 12-month SGD fixed deposit savings rate from Monetary Authority of Singapore, as of 30 September 2016.

15

0.4%

0.9%

1.8%

2.5%

3.5%

5.6%

6.5%

12-mth SGD Fixed Deposit

10-yr HK Gov Bond Yield

10-yr SG Gov Bond Yield

CPF Ordinary Account

Hang Seng Index

FTSE ST REIT Index

MGCCT Yield



About MGCCT

1

2



4



• Healthy Balance Sheet − Average term to maturity for debt of 3.10 years

• Prudent Capital Management − Average all-in cost of debt of 2.89%

− 85.0% of debt fixed1 as of 30 Sep 2016

− FX volatility mitigated as ~80.0% of expected FY16/17 distributable

income has been hedged into SGD

Average All-in

Cost of Debt

2.89%

Gearing

Ratio

39.9%

Percentage of

Debt Fixed1

85.0%

Expected

FY16/17

DI Hedged

into SGD

~80.0%

Note: Information in the boxes above are as of 30 September 2016

1. Interest cost on 85.0% of the total debt was fixed

Proactive Capital and Prudent Risk Management

MGCCT

Corporate

Rating by

Moody’s

Baa1 Stable

17



About MGCCT

1

2



4



Portfolio Occupancy of 95.7% as at 30 Sep 2016

• Consistently high occupancy rate for both properties

Occupancy Rate By Qtr As at 30

Sep 2015

As at 31

Dec 2015

As at 31

Mar 2016

As at 30

Jun 2016

As at 30

Sep 2016

Festival Walk 100.0% 100.0% 100.0% 100.0% 100.0%

Gateway Plaza

96.3% 97.0% 96.8% 95.0% 90.5%

Sandhill Plaza 100.0%1 100.0% 100.0% 100.0% 99.6%

Portfolio 98.4% 98.7% 98.6% 97.8% 95.7%

1 Sandhill Plaza’s committed occupancy rate of 96.2% as at 31 March 2015 was disclosed in the acquisition announcement on 15 June 2015

19

Rental Reversion by Asset

• 57%4 of expired/expiring leases at portfolio level in FY16/17 have been

renewed/re-let

1 Rental reversion is computed based on the weighted average effective base rental rate for expiring leases vs. the weighted average

effective base rental rate of the contracted leases that were renewed or re-let over the lease term 2 There was no office lease expiry at FW in FY15/16 3 Sandhill Plaza was acquired on 17 June 2015. There were only two leases that were renewed or re-let in FY15/16 at 33% 4 By lettable area

YTD Rental Reversion

By Qtr1

As at 30

Sep 2015

As at 31

Dec 2015

As at 31

Mar 2016

As at 30

Jun 2016

As at 30

Sep 2016

Festival Walk

- Retail 20% 42% 37% 13% 15%

- Office n.a.2 n.a. n.a. 11% 7%

Gateway Plaza

- Office 25% 29% 25% 6% 8%

Sandhill Plaza

- Office3 n.a. n.a. n.a. 28% 23%

20

Note:

Lease expiry profile is based on existing leases while WALE is based on committed leases

Portfolio Lease Expiry Profile as of 30 Sep 2016

21

Weighted Average Lease

Expiry (WALE) by Gross

Rental Income (GRI)

Portfolio : 2.6 years

Festival Walk (FW) : 2.2 years

Gateway Plaza (GW) : 3.9 years

Sandhill Plaza (SP) : 1.6 years

10.6%

21.0% 19.1%

9.1% 8.6%

2.6%

12.4%

3.1%

2.3% 3.8% 1.7%

3.1%

1.3%

1.0% 0.3%

FY16/17 FY17/18 FY18/19 FY19/20 FY20/21 and beyond

FW: Lease Expiry by % of GRI GW: Lease Expiry by % of GRI SP: Lease Expiry by % of GRI

14.9%

36.5%

23.5%

12.4% 12.7%

• One of the largest tenants of the portfolio (by gross rental income) has committed a further five-

year term, which extended its lease from FY17/18 to FY22/23

Trade Sector by Gross Rental Income

No single trade sector comprises more

than 22.5% of GRI

Top 10 Tenants by Gross Rental Income

Top 10 tenants comprise 27.8% of GRI

Diversified Portfolio Tenant Mix (as of 30 Sep 2016)

22

1. BMW GW

2. ARUP FW

3. TASTE FW

4. FESTIVAL GRAND FW

5. CFLD GW

6. APPLE FW

7. I.T FW

8. BANK OF CHINA GW

9. CUMMINS GW

10. SPREADTRUM SP

FW - Festival Walk; GW - Gateway Plaza; SP – Sandhill Plaza

Refreshed Tenant Mix and Introduced New Concepts and Brands

Zara Home Seed Heritage Nike Basketball

An Nam Restaurant (Vietnamese) fresh sen-ryo (Japanese)

Nespresso

23

Tumi Panino Giusto (Italian) Log-on - New look after renovation

First-of-its-kind and exciting marketing events continued to

attract shoppers to Festival Walk

First-ever Disney Tsum Tsum

promotion in HK

Chinese New Year Celebrations

Life-size Batmobile at movie event Pink Panther Poolside Party

24

Movie Gala Premiere featuring

Andy Lau “Line Walker” Movie Premiere starring Louis

Koo, Nick Cheung and Charmaine Sheh

Football game on skates at the Glacier ‘Sports Craze’ Event HK Figure Skating

Championship

Festival Walk: Corporate Social Responsibility Events

HK$1.1million

was raised from the

charity events held at

Festival Walk in

FY15/16

Wai Yin Association’s Charity

Mooncake Sales event

Hong Kong celebrity Louis Koo at a

Charles K. Kao event

Events were kicked off by

HK celebrity Miriam

Yeung

Fund-raising for

Salvation Army

Support Charles K. Kao Foundation’s

outreach efforts at their Alzheimer’s

disease center for the elderly

25



About MGCCT

1

2



4



Continual Asset Enhancement Initiatives (AEI) at FW in FY16/17

27

To improve shoppers’ experience:

- Shop units converted to F&B

- Upgrading of the foodcourt in

progress

- Completed the refurbishment of all

toilets in the mall

AEI at Gateway Plaza Completed in 1Q FY16/17

Removed

advertisement

panels[1] and

palm trees[2] and

added F&B

amenities at

under-utilised

podium area

Added F&B amenities at under-utilised podium area

28

Alfresco dining area

Dining at Lobby area

Interior Decor

New Western Restaurant, Cup One

AEI at Gateway Plaza Completed in 1Q FY16/17

Removed the pond

area[1], added a

new staircase[2]

and a pair of see-

through lifts[3]

Converted a

portion of the

rear stone wall to

a glass curtain

wall

Improved accessibility at podium level

• Improved natural lighting and visibility for new F&B units

29

Bubble lift on L3



About MGCCT

1

2



4



Well-positioned to capture growing

demand from the decentralisation trend

Expanded footprint to Shanghai 1

Fits into the Manager’s investment strategy

Good accessibility & transportation links

Accretive acquisition contributing to both

portfolio gross revenue and NPI

Established tenants including leading

global companies

2

3

4

5

6

Sandhill Plaza: Successful Maiden Acquisition

• The high occupancy rate of 99.6% as of 30 Sep 16 reflects good demand for business

park spaces in decentralised locations

31

Sandhill Plaza, Shanghai 1

1 Sandhill Plaza was acquired on 17 June 2015

MGCCT Strategy

Resilient Portfolio

Festival Walk: Rental reversions expected

to moderate

Gateway Plaza: Focus on improving

occupancy level

Sandhill Plaza: Healthy organic growth

Active & Prudent Capital

Management

Well staggered debt profile

High interest coverage ratio

Maintain high fixed to floating debt ratio

Distributable income to be well hedged

against HKD and RMB exposure

Growth Opportunities

Explore asset enhancement initiatives for

Festival Walk and Gateway Plaza

Value-adding acquisitions of quality, well-

located assets with focus on tier-1 cities in

China

Proactive Asset

Management

Focus on cost management

Enhancement of amenities

Active lease management

Increase retail sales and drive footfall to

Festival Walk

32

Thank You

Investor Relations Contact:

Elizabeth Loo Suet Quan Tel: +65 6377 6705

Email: [email protected]

mapletree greater china commercial trust... · ipo (7 mar 2013) to 30 sep 2016 18.3% 25.5% 43.8% 1....

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